Billionaire investor Warren Buffett said that his holding Berkshire Hathaway has no plans to acquire another railroad company, thus dispelling rumors of a possible merger. In recent weeks, the market has been actively discussing the possibility of a merger between operator CSX and Berkshire-owned BNSF. After Buffett's denial, CSX shares fell more than 5% in trading on August 25.

Details

Warren Buffett, founder of Berkshire Hathaway investment holding company, said Aug. 25 that he has no intention of acquiring another railroad company, CNBC reported .

In recent weeks, the market has been actively discussing the possible merger of CSX, one of the leaders in the U.S. rail industry, with BNSF Railway, the largest transportation asset in Berkshire's portfolio, Reuters notes .

After denial of rumors, CSX shares fell by 5.1% at the end of trading on August 25. The decline affected the securities of other operators: Union Pacific fell in price by about 2%, Norfolk Southern lost more than 2%. Shares of Berkshire Hathaway fell less than 1%.

Buffett confirmed that he met with CSX CEO Joseph Hinrichs on August 3. Buffett's designated successor as CEO of Berkshire, Greg Abel, also participated in the talks. According to the investor, they immediately made it clear that they will not make an offer to buy CSX, but are open to increased cooperation, which could give both sides some of the benefits comparable to the effect of the merger.

Context

CSX and BNSF announced the launch of new transcontinental services on Aug. 22, strengthening their freight ties but also lowering market expectations of a possible merger.

Back in July, two other U.S. railroad giants - Union Pacific and Norfolk Southern - unexpectedly announced a deal worth $85 billion. If approved, it will create the country's first transcontinental freight carrier, according to Reuters.

This article was AI-translated and verified by a human editor

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